Foot Locker Inc. (FL) - Get Report shares surged Wednesday after the athletic apparel retailer posted stronger-than-expected third quarter earnings after the closing bell Tuesday that defied the sector's disappointing session ahead of this season's Black Friday shopping event.
Foot Locker said non-GAAP earnings for the three months ending on November 3 came in at 95 cents a share, topping the Street forecast of 92 cents and rising 9.2% from the same period last year. Overall group revenues slipped marginally from last year, to $1.86 billion, but again came in ahead of analysts' estimates, as same store sales growth was tabbed at a better-than-expected 2.9%.
"The third quarter was a good one for us," CEO Dick Johnson told investors on a conference call late Tuesday. "We believe this positive performance should translate into the fourth quarter as well. But we are not resting, we're excited about the long-term growth opportunities we are developing to drive a further emotional connection with our consumers."
"These include having the most sought-after assortments, partnering with the best brands in the world to deliver innovative products and storytelling and bringing incredible experiences to consumers through our improving digital capabilities and progress on making our stores even more unique and exciting destinations," he added.
Foot Locker shares were marked 15.5% higher at $53.17 each, the highest since late June and a move swings the stock into positive territory for the year and value the New York, N.Y.-based retailer at just over $6.1 billion.
"Last quarter, we were surprised that the company's results weren't better, and, this quarter, we're surprised they weren't worse," said Pivotal Research Group analyst Mitch Kummentz. "We believe Foot Locker's running strength speaks to the benefit of improved depth and flow of premium product, and we expect this to help drive the company's (fourth quarter same store sales) as well."